The most common question we get asked as real estate agents is: How’s the market? Watch both Scott’s and Lane’s Take for their opinions on how the market is looking today. Is there a crash coming? Is the bubble about to burst?
I’ve been a real estate agent for over 33 years and I’ve seen it all.
Right now it seems like we are at the top of an appreciation cycle.
There are 3 things that I’ve seen recently that show the market is ready to move:
1. More open house signs: this is a very basic sign but it shows that there are more homes on the market and they are sitting a little longer than we’ve come to expect.
2. Bank appraisals coming in under what the house sold for: if there is financing involved in the transaction, the bank will come in and appraise the property. Their job is to make sure the property is worth what the buyer is paying. My last few appraisals have come in closer to what the list price was and not what the buyer has agreed to pay. The banks seem to be putting a lid on things.
3. General Inflation: interest rates are going up to help check inflation. People are reigning back their spending and tightening up their budgets. We’re seeing some of our buyers deciding to hold off on their purchase to feel out the economy before diving back in.
All of these things are anecdotal BUT they are things we are seeing in real-time. It looks like the market is beginning to stabilize.
Is the market headed for a crash? I still don’t think so. The demand is still high, just not as high as before. We aren’t going to see the same appreciation we’ve been used to for the last 2 years.
The doors are cracking open to give buyers a better chance.
We’ve been so used to a strong seller’s market with homes appreciating faster than expected.
I’m beginning to sense a shift happening in the market today.
1. Prices are still high
2. Mortgage interest rates are up and expected to rise more
3. Combining 1&2 results in buyer demand decreasing
Are buyers walking away from purchasing a home? Mine haven’t.
The market is shifting therefore people are shifting their needs. They’re changing their criteria and price points, opening up to new locations, and starting to explore new loan products.
1. Inventory is up, but we are still in a seller’s market
2. Pricing your home $25k more than the home across the street is no longer valid
3. Homes are sitting on the market longer
Is the market going to crash? I don’t think so. BUT it is shifting.